CNX Resources

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    Range, CNX Look for Alternatives to ME1 Pipe Following Shutdown

    MDN reported yesterday that due to underground horizontal direction drilling (HDD) in Chester County, PA (near Philadelphia) for the Mariner East 2 (ME2) Pipeline project, a third sinkhole had developed (see PA PUC Shuts Down Mariner 1 Pipeline Due to Mariner 2 Sinkhole). ME2 is being built close to the existing Mariner East 1 (ME1) pipeline. The sinkhole exposed a portion of the ME1 pipeline to the open air. Not a good situation, which is why the state Public Utility Commission has temporarily shut down the propane and ethane flowing through ME1. The shutdown is for 10-14 days. Problem is, both Range Resources and CNX Gas pump propane and ethane through ME1. With the shutdown, both companies are “scrambling” to find alternative means to get their NGLs to market…
    Read More “Range, CNX Look for Alternatives to ME1 Pipe Following Shutdown”

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    Top 3 Most Productive Drillers in the Marcellus Shale

    We spotted an intriguing story that summarizes some of the information found in a newly-released report from private equity firm Baird Equity Research. Baird’s report purports to show, using data, “the most productive operators in the Marcellus shale.” What is the criteria used? They use productivity per average well along with how much money the average well is generating for the operator (i.e. driller). We wish we had a copy of the full report. Sadly, we do not. However, we do have the article summarizing it, which shares the top three operators. The top operator stands head and shoulders above the rest. Would it surprise you to learn the top operator in the Marcellus, according to Baird, is Cabot Oil & Gas? No, it didn’t surprise us. What about the other two in the top three? And what about the top Utica operator? Read on…
    Read More “Top 3 Most Productive Drillers in the Marcellus Shale”

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    CNX Resources CEO Says Average CNX Worker Makes $170,000 per Year

    It looks like CNX Resources (formerly CONSOL Energy) is THE place to work if you live anywhere in the orbit of Pittsburgh. Our eyeballs about fell out when we read comments made by CNX Resources President and CEO Nick DeIuliis in a speech he gave yesterday at the Pittsburgh Business Times’ VisionPittsbugh event. According to PBT reporter Paul Gough, “He [DeIuliis] said the CNX workforce was young, highly skilled and driven, drawn from Baldwin Borough to Nigeria, and making an average of $170,000 a year.” Wow! Where do we sign up? In commenting on Pittsburgh’s ongoing water issues, DeIuliis said “so-called green fixes is absurd.” A man after our own heart. Here’s more of what DeIuliis said yesterday…
    Read More “CNX Resources CEO Says Average CNX Worker Makes $170,000 per Year”

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    CNX Resources Sells Its Conventional Wells in PA, OH, WV for $85M

    We spotted an announcement by Diversified Gas & Oil that they have just cut a deal with two different companies–Alliance Petroleum and CNX Resources–to purchase conventional well assets from both companies for a combined price of $180 million. Alliance, based in Akron, OH, has drilled and maintained conventional oil and gas wells in the Appalachian region since 1985. While that part of the story is of passing interest, the more interesting part (for us) is Diversified’s purchase of CNX’s conventional (non-shale) wells in PA, OH and WV. This deal echos a similar deal done by Cabot Oil & Gas last summer when they sold all of their conventional wells in Appalachia (primarily in WV) to Carbon Natural Gas Company for $21.5 million (see Carbon Natural Gas Buys Cabot’s Conventional Wells in WV-OH-VA). The CNX deal with Diversified is for $85 million. Is this now a bona fide trend–shale companies shedding their portfolio of conventional assets? Perhaps! Below is the Diversified announcement…
    Read More “CNX Resources Sells Its Conventional Wells in PA, OH, WV for $85M”

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    CNX Adds 31 Marcellus/22 Utica Wells, Boosts Reserves 21% in 2017

    Click image for larger version

    CNX Resources (formerly CONSOL Energy) released a 2017 recap yesterday–a high level overview of the company’s accomplishments last year. The main point of the announcement was to point out that proved reserves–the gas and oil and other hydrocarbons the company can extract at today’s prices using today’s technology–went up a healthy 21% in 2017 over 2016. CNX figures they own 7.6 trillion cubic feet equivalent (Tcfe) of natural gas, oil, condensate and NGLs–sitting in the ground under CNX leased acreage. As you dig further into the announcement you find that CNX turned-in-line (TIL) 31 Marcellus wells and 22 Utica wells last year. Laterals (the horizontal part of the well) in the Marcellus averaged 8,400 feet long, and Utica laterals averaged 8,800 feet long. Here’s the 2017 roundup and proved reserve report from CNX…
    Read More “CNX Adds 31 Marcellus/22 Utica Wells, Boosts Reserves 21% in 2017”

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    CNX Sells WV Gathering System to Former CONE Midstream for $265M

    CNX Resources, in addition to issuing an announcement about proved reserves yesterday (see today’s companion story), also issued an announcement about CNX the drilling company selling its Shirley-Pennsboro gathering system in West Virginia to CNX the pipeline company (CNX Midstream) for $265 million. Yes, in a sense it is moving assets around on paper. However, this seemingly innocuous announcement is interesting to MDN for a couple of reasons. First, there is a trend of splitting companies apart–to spin out the pipeline/midstream stuff into its own standalone company, separate from the drilling part of the company. EQT, a major CNX competitor, is going through the process of evaluating whether or not to spin off their pipeline subsidiary into its own company (see EQT Begins Process of Separating Midstream…into New Company?). When we see moves like this from CNX, we wonder if they too are also preparing for such a split. We have no evidence that such a move is in the cards–just idle speculation on our part. However, the fact that CNX is moving pipeline assets into the midstream subsidiary certainly sets up the possibility that the pipeline subsidiary may (one day) become a standalone company. Second, the pipeline subsidiary is called CNX Midstream. That’s a new name. As of early January you would have known it as CONE Midstream. CNX bought out its joint venture partner in CONE (Noble Energy) late last year and now owns all of CONE. CNX renamed CONE as CNX Midstream in early January (see CONE Midstream Gets a New Name: CNX Midstream Partners). We’ve not seen anyone else point out the fact that the former CONE is the buyer of this asset. For those two reasons–the trend of splitting drilling and pipelines into different companies, and the fact that CONE was the buyer–our interest was piqued in CNX’s seemingly innocuous announcement yesterday…
    Read More “CNX Sells WV Gathering System to Former CONE Midstream for $265M”

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    SWPA Antis Twist State Laws in Bid to Declare Shale Drilling Illegal

    In November 2015 MDN reported on a seemingly obscure zoning court case in Westmoreland County, PA (see 3 Western PA Antis Weigh Appeal of Court Ruling in Zoning Case). Three ladies brought a lawsuit against Allegheny Township because the town approved a permit for CNX Gas–to drill a well on a farm owned by John and Anne Slike. Since the farm is about 1,200 feet from where the ladies live, they objected. We thought the case was long over with. But it’s not. As we recently pointed out, the ladies and their radical fractivist lawyer appealed using a novel legal argument (see SWPA Antis Breathe New Life into Old Zoning Lawsuit). Based on recent PA Supreme Court cases that uphold so-called environmental rights for all PA citizens, the ladies and their lawyer claim that allowing Marcellus drilling violates their environmental rights and they will experience mythical harms. The problem with the case is that if they win, it’s not much of a stretch for antis everywhere to claim the same thing–promptly ending the miracle of Marcellus drilling in the Keystone State…
    Read More “SWPA Antis Twist State Laws in Bid to Declare Shale Drilling Illegal”

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    CNX 4Q17 Results: Drilled 4 New Wells, Completed 19 Wells

    CNX Resources, the gas drilling part of what used to be CONSOL Energy (but now is it’s own separate company), issued their fourth quarter 2017 update earlier this week. What a difference a year can make, at least financially! In 4Q16 CNX lost $300 million. In 4Q17 CNX made a $282 million profit. That’s a swing of $582 million–over half a billion dollars. CNX used $103 million of that money to buy back some of the company’s outstanding shares of stock. CNX produced 118.9 billion cubic feet equivalent (Bcfe) of production during 4Q17, which translates to 1.32 Bcfe per day. That’s new record high production for CNX. Production costs fell to $2.17 per thousand cubic feet (Mcf). During most of 4Q17 CNX operated 2 horizontal shale drilling rigs, adding a third rig in late December. The company only drilled four new wells in 4Q17: one dry Utica Shale well in Monroe County, OH; one deep dry Utica Shale well in Greene County, PA; one deep dry Utica Shale well in Indiana County, PA; and one Marcellus Shale well in Greene County, PA. However, they kept the rigs busy by completing 19 wells–DUCs, or Drilled but UnCompleted wells, drilled prior to 4Q17. CNX proved they can walk and chew gum at the same time over the past three months. While they were drilling 4 new wells and completing another 19 wells, during that same time period they (a) split the company in two, separating the gas drilling business from the coal business, (b) bought and closed on Noble’s 50% share of what was CONE Midstream (now CNX Midstream Partners), and (c) bought back $103 million shares of the company’s common stock. Busy beavers! Here’s the full 4Q17 update from CNX Resources…
    Read More “CNX 4Q17 Results: Drilled 4 New Wells, Completed 19 Wells”

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    CNX Res. 2018 Plans: 65% Marcellus Drilling, 35% Utica Drilling

    CNX Resources, the gas drilling part of what used to be CONSOL Energy (but now is it’s own separate company), issued guidance yesterday for how much money they intend to spend on drilling in 2018. CNX will spend somewhere between $790-$880 million on drilling and midstream projects this year, with 65% of that total going for Marcellus projects, and 35% for Utica projects. That high level number breaks down as $515-$580 million for drilling and completions, and $275-$300 million for water, land and midstream infrastructure. CNX expects to drill 75 wells, 60 of them in the Marcellus, in PA and WV, and 15 in the Utica, in PA and OH. CNX plans to frack 51 wells this year, mostly in PA, and bring 59 wells online to production, again mostly in PA. The company also provided a big tease by saying it will spend $75-$100 million on running water pipelines “for two major stacked pay project areas that the company expects to be ready in the fourth quarter of 2019.” Hmmm. Wonder where they intend to expand in 2019? No CNX’s tease will stoke the rumor mill. As part of yesterday’s announcement, CNX also provided impressive data on a pair of dry Utica wells they recently drilled in Westmoreland County, PA…
    Read More “CNX Res. 2018 Plans: 65% Marcellus Drilling, 35% Utica Drilling”

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    CNX’s Pipelines to be Used for “Partners” – Not Just CNX Res.

    Yesterday we brought you the news that CONE Midstream has been renamed to CNX Midstream, and that CNX Resources is now the sole owner of the entire gathering pipeline system (see CONE Midstream Gets a New Name: CNX Midstream Partners). CONE was originally a joint venture between CONSOL Energy (the “CO” part of the name) and Noble Energy (the “NE” part of the name). CONSOL and Noble had a joint venture on hundreds of thousands of Marcellus/Utica Shale acres. Some of the wells drilled were “owned” by CONSOL, some by Noble. CONSOL and Noble decided to divide up the JV, each taking a piece, in late 2016 (see Divorce: CONSOL & Noble Dissolve M-U Joint Venture). Then in May 2017, Noble up and sold all of their Marcellus leases and wells, to HG Energy (see Noble Energy Sells Remaining M-U Assets for $1.2B – Who Bought?). Not long after, Noble announced they also want to sell their share of CONE. Long story short, CNX (formerly CONSOL) bought Noble’s CONE share, and now owns it lock, stock and barrel. Does that mean CNX will no longer flow gas from HG Energy (formerly Noble) wells served by their 100%-owned pipelines? Not on your life! CNX will continue to service HG Energy’s wells, and may even run gathering lines to other competitors’ wells (i.e. “partners”) in the areas where CNX Midstream operates. So said CNX CEO Nick DeIuliis on a conference call yesterday with analysts. DeIuliis is jazzed that his company now owns 100% of the pipeline gathering system because it will allow them to “move quickly” to seize opportunities…
    Read More “CNX’s Pipelines to be Used for “Partners” – Not Just CNX Res.”

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    CONE Midstream Gets a New Name: CNX Midstream Partners

    CONE Midstream is, or rather was, a pipeline joint venture between CONSOL Energy and Noble Energy (“CO” from CONSOL and “NE” from Noble Energy), formed in the summer of 2014 to service wells drilled as part of CONSOL & Noble’s drilling joint venture (see CONSOL & Noble Energy Form New Marcellus Midstream Company). Following Noble’s exit from the Marcellus last year, they began to shop their 50% share of CONE, and thought they had found a buyer in Quantum Energy Partners–for $765 million. However, as we reported in December, that deal hit a snag (see Noble’s 50% CONE Midstream Sale in Trouble – Shopping Deal to CNX). Not long after, CNX Resources (formerly CONSOL Energy) issued a press release to announce they had cut a deal to buy Noble’s 50% CONE share–for $305 million, which is 60% less than of the deal price Noble previously worked out with Quantum (see CNX to Buy Noble’s 50% Share of CONE Midstream for $305M). Two bits of news to share with you regarding the CONE deal: (1) the deal is now done, and (2) CNX Resources has renamed CONE Midstream to be CNX Midstream–which should not be a surprise since the NE part of CONE is now gone, and since the CO part changed its name. Here’s the news…
    Read More “CONE Midstream Gets a New Name: CNX Midstream Partners”

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    CNX Resources Clipped $433.5K for Groundwater Violations in SWPA

    The Pennsylvania Dept. of Environmental Protection (DEP) has fined CNX Resources (formerly CONSOL Energy/CNX Gas) $433,500 for violations at four shale well sites in Greene County, PA. The violations, which happened in 2015/2016, include failure to control and dispose of wastewater properly and failure to prevent erosion. Some of the flowback/wastewater ended up in a small stream called Jacobs Run. We always find the language of these announcements by the DEP somewhat strange: “CNX Gas Company, LLC (CNX) has agreed to two civil penalties totaling $433,500 for violations at well sites in Greene County.” Really? The company getting fined has to “agree” to accept the fine? Apparently we don’t fully understand how regulatory agencies work in PA. What if CNX didn’t agree to the fine? Would the DEP come back with a lower amount, “Will you accept this fine instead?” But we digress. CNX themselves noticed the problems and self-reported the violations. After doing so, they fired two of the service companies they were using. The unnamed service companies were obviously guilty of cutting corners that resulted in improper disposal of wastewater. Interesting factoid: Half of all the wells CNX has drilled in PA are located in Greene County…
    Read More “CNX Resources Clipped $433.5K for Groundwater Violations in SWPA”

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    CNX to Buy Noble’s 50% Share of CONE Midstream for $305M

    On Monday MDN shared news with you that we believe was exclusive news–nobody else picked up on it. The news was that Noble Energy’s original plan to sell its 50% stake in CONE Midstream to Quantum Energy Partners for $765 million, announced back in May, is in trouble (see Noble’s 50% CONE Midstream Sale in Trouble – Shopping Deal to CNX). We told you that according to a recent Securities and Exchange Commission filing Noble had begun negotiations with CNX Resources (formerly CONSOL Energy), which is the other 50% owner of CONE, to sell Noble’s share to them. It seems we were prophetic. This morning CNX issued a press release to announce they have cut a deal to buy Noble’s 50% CONE share–for $305 million. That’s 40% of the deal price Noble previously worked out with Quantum. Must be it’s a buyer’s market for midstream assets…

    12/18/17 Update: On Friday, following CNX’s announcement about buying the rest of CONE from Noble Energy, Noble also issued an announcement (below). Noble’s announcement amusingly leaves out the purchase price–less than half of the previously deal they had with Quantum.
    Read More “CNX to Buy Noble’s 50% Share of CONE Midstream for $305M”

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    Noble’s 50% CONE Midstream Sale in Trouble – Shopping Deal to CNX

    In May MDN brought you the news that Noble Energy dropped a bombshell, selling its 100% interest in 385,000 Marcellus/Utica acres and wells producing 415 million cubic feet equivalent of natural gas in West Virginia and Pennsylvania for $1.225 billion to HG Energy (see Noble Energy Sells Remaining M-U Assets for $1.2B – Who Bought?). A couple of weeks later the other shoe dropped when Noble announced they would sell their 50% stake in CONE Midstream, a 50/50 joint venture with CONSOL Energy (now CNX Resources), to Quantum Energy Partners for $765 million, meaning a total exit for Noble from our region (see Noble/CONSOL Breakup Continues: Noble Sells 50% of CONE Midstream). When we say Noble “sold” their CONE stake we mean “will be sold after all the lawyers and bean counters get done with drawing up the necessary paperwork.” Fact is, the CONE sale has still not happened, even though there is a Dec. 31 deadline for the deal to be completed. It appears Noble’s deal to sell it’s CONE stake to Quantum is now in jeopardy. We base that observation on information from a filing Noble made with the Securities and Exchange Commission last week. In an 8-K filing, Noble said (a) they’ve extended the deadline to complete the deal to sell CONE to Quantum from Dec. 31, 2017 to June 30, 2018, and (b) Noble has opened up discussions/negotiations with CNX to sell their half of CONE to CNX instead of selling it to Quantum–which would make CNX the 100% owner of CONE…
    Read More “Noble’s 50% CONE Midstream Sale in Trouble – Shopping Deal to CNX”

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    CONSOL Energy Split Done – Meet “New” Gas Driller CNX Resources

    CONSOL Energy, headquartered in Pittsburgh, began life as a coal company some 150 years ago. For the past half dozen years MDN has reported on CONSOL’s transformation from coal company to natural gas company. That transformation, as of yesterday, is complete. In July CONSOL filed paperwork with the Securities and Exchange Commission that laid out a plan to split the company in two, into a coal company and a natural gas exploration and production company (see CONSOL Energy’s Split into 2 Companies Nearly Complete, New Name?). Yesterday was the first day for the separated companies. CONSOL the coal company retains the CONSOL Energy name and get various coal mines and other coal-related assets. The CEO of the coal company is Jimmy Brock. Meanwhile, CONSOL the natural gas driller got a new name–CNX Resources–and retains all of the other assets. Nick DeIuliis, former president and CEO of CONSOL Energy when it was all one company, is the president and CEO of CNX Resources. In speaking about the newly separated gas drilling company, CNX Resources COO Tim Dugan said this: “You’ll see the Utica becoming a larger and larger part of our development.” Here’s the big news that CONSOL is now split into two different companies…
    Read More “CONSOL Energy Split Done – Meet “New” Gas Driller CNX Resources”

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    Exclusive: CONSOL Energy Sells WV Acreage/Wells to Antero Resources

    A week ago a sharp MDN reader (landowner) in West Virginia emailed us to ask about news of a sale by CNX Gas (i.e. CONSOL Energy) of their leases and wells in Doddridge County to Antero Resources. We were stumped. We’ve neither heard nor read anything about it. We searched. And searched. And searched. Nothing. She wrote again a few days later–had we heard anything? Nope. Then we got a second email from another MDN reader asking about the same thing. Our second questioner is in the oil and gas industry. When we questioned him, he gave us a few more clues: It may not only be in Doddridge, but also Tyler County too. There’s something happening in both areas. So we put our feelers out to a number of industry contacts and heard back from one of them–a highly placed source–who confirmed our tipsters. So we now have three people confirming. We know something has been sold and deeds are getting transferred from CNX to Antero in at least one county. Our best guess is that a sale is happening not just in Doddridge, but also in Ritchie, Tyler and Pleasants counties too. We have not (yet) been able to confirm this with Antero, but we feel we have enough to share with you, our valued readers. Here’s what we know, the evidence we have, and a map of the acreage we believe has been/is getting transferred from CNX to Antero…
    Read More “Exclusive: CONSOL Energy Sells WV Acreage/Wells to Antero Resources”